Radios[HACK]: How the Maker Movement Could Have Saved a Dying Retailer

Last week, fueled by my determination to finally figure out how they worked, I began to build my first transistor radio, with parts purchased on the cheap and accompanied by a myriad of “how to” books from Amazon.com.

Remarkably, despite the nature of my project, the very company that was originally formed to cater to ham radio enthusiasts — RadioShack — was farthest from my mind.

So I suppose it should have come as no surprise when I discovered that the aging electronics retailer was preparing to file for bankruptcy. Upon discussion, my friends shared a mutual tinge of regret, not because we patronized the stores in any meaningful way, but because we both wondered aloud what might have been. While this is not the first time that they’ve come close to shuttering their doors- with billions of dollars in debt and multiple recent missteps in attempting to spur new business, it’s unclear what the future holds for the company.

For decades, RadioShack’s success has relied on selling electronic gadgets to consumers, a retail strategy characterized by plunging prices on commoditized products, and that has been long transformed by online retailers. And with the announcement that SkyMall, another notorious platform for selling gadgets to geeks, is also filing for bankruptcy, it’s abundantly clear that the gadget geek niche isn’t enough to sustain a business, certainly not if you’re a box retailer.

Remarkably, while RadioShack is clearly challenged on many levels as a retailer, it is one of the very few large corporations that have been able to successfully integrate themselves with the Maker Movement. Through partnerships with Make Magazine, Instructables, and other outlets the company has been a reliable provider of content and shared knowledge. While being a dependable resource for makers failed to deliver corporate profits in the past, I had to wonder: could RadioShack effectively re-engage the maker movement and come back from the grave?

The History of RadioShack

RadioShack’s history has been heavily intertwined with the maker movement since its inception in the 1920s, when it was founded as a small retail business for radio equipment, catering to amateur “ham” radio operators. Throughout the decades, despite multiple iterations and management regimes, it has sold not just consumer electronics, but most importantly the parts to fix, modify, and enhance them.

In this business mix is an important distinction between RadioShack and any other electronics retailer. RadioShack was able to grow and prosper as it did because of two major factors: the first was the ubiquity of electronics in American homes, and the second was a long era of American resourcefulness. RadioShack was instrumental to generations of American whose habits were forged by economic hardship. They fixed things when they broke, and when they needed something specialized, they built it with parts on hand. Being American was, for a very long time, to also be a Maker.

Because of this, RadioShack’s brand still has a powerful legacy and inherent value despite the company’s current circumstances. Ask your parents and grandparents what they think of when you say RadioShack, and they will reminisce about their Battery-of-the-Month Club, the bins of parts and imagining what could be made out of all that stuff, the radios and the walkie-talkies, and spending a weekend working on an electronics kit as a family affair.

Rarely, if ever, will that fond memory involve buying a television, speakers, or a cell phone at RadioShack, which speaks directly to when, and why, the company began to fail.

An Overabundance of Nothing

As consumer electronics grew in popularity while, correspondingly, plummeting in price, the national DIY culture atrophied. Customers were more inclined to throw out dying electronics and buy a new model every year. The innovation in electronics that gave birth to RadioShack quickly began to outpace it. Big box retailers like Best Buy scaled past them with the sheer quantity of inventory, and the launch of online retailers like Amazon delivered a crushing, final blow.

Within just a few decades, RadioShack went from being the place to get your electronics, to the place you went to get that one thing you forgot at Best Buy or the one thing you needed right this very second so Amazon wasn’t an option. Even worse was the growing trend of buying that one cord you need now, only to return it a few days later and buy it for cheaper online. I’m guilty of it, and I suspect I’m not alone.

Ultimately, over time RadioShack became irrelevant to consumers. The revolving door of new management teams and strategies seemed incapable of avoiding a fatal flaw: the continued attempts to sell electronics to consumers in a way, and at a price point, they simply didn’t want.

RadioShack or RadiosHACK?

If the Great Depression made makers of past generations of Americans, the current economic climate has been accelerating another generation of makers over the past decade.

To its credit, RadioShack has been diligent in engaging makers with partnerships and sponsorships for over a decade: from providing robotics kits in partnership with FIRST in 2005, to being a longtime partner with Make Media. They’ve worked with Instructables to provide co-branded tutorials, and even have their own tutorials site, branded “DIT”, or “Do It Together”. Through these efforts, it’s apparent that someone at RadioShack knows where makers are, and how to engage them effectively. They’re joining them on their turf and providing content — but these efforts, successful where many of their corporate peers have fallen flat, never quite translated into meaningful increases in revenue.

Here’s the rub — take any tutorial RadioShack offers online, decide you’ll build it, and then look at the parts list. If you’re lucky, you might be able to get half of the parts at an actual RadioShack store. If you can’t find the parts at an actual store, but they’re available from RadioShack’s website, you’ll find yourself subject to higher prices and longer shipping times than most other U.S.-based online retailers.

RadioShack has, in essence, solved the harder part of the retail problem here — it has provided engaging content, and in doing so created a buyer. But by not providing the required inventory, RadioShack has thwarted all of it’s content efforts, making it not only irrelevant to mass market consumers, but the one demographic that has a sustained relationship with the brand since its

So how can RadioShack effectively leverage its brand to engage with these makers in a profitable way?

To be successful, RadioShack needs to highlight two key components of its business and brand: choice and immediacy.

1. Increase Inventory

The consumer electronics space is crowded and, frankly, an unlikely source of profit for an aging offline retailer. RadioShack needs to start thinking more like Home Depot, and less like Best Buy — by offering the relevant tools, parts and pieces to build electronics, rather than just the final, complex product.

While it’s easy to find inexpensive electronics parts at online retailers like Alibaba, eBay, and maker-centric sites like Adafruit Industries and Sparkfun, there remains no reliable place to go to find those same parts in person, on a weekend, when you’re actually making. Makers thrive on immediate gratification, meaning if they don’t have the correct parts, they’ll move on to another project, and any potential revenue from the abandoned project is now lost.

RadioShack is in a unique position to provide immediacy, with 4,400 stores across the US and Mexico. RadioShack can, and should, leverage those locations to bring back the emotionality in their brand — the experience of buying all the necessary parts to build, fix, or enhance something over the weekend with family or friends. Inventory levels will have to be high enough to give choice: from transistors to LEDS to the multitude of quality kits and prototyping boards, and the retailer will have to ensure that the staff is educated enough to discuss those options (much like the contractors that staff Lowe’s and Home Depot).

And since we’re offering advice, for the love of all, please sell quality soldering irons and wire in all of your stores.

2. Upgraded Facilities

RadioShack has understood that to engage makers, they need to join them on their turf, getting involved in MakerFaire, Instructables, and makerspaces all around the U.S., but they seem to be missing why those organizations fundamentally appeal to the maker movement. That appeal is founded in collaboration.

While TechShop, makerspaces, and Fab labs have grown in popularity, they still serve the primary function of education and community, rather than efficiency. As the line between maker and entrepreneur is ever-blurring and the ease of prototyping is increasing, there’s a desire for the ability to 3D print a model or etch a PCB instantaneously, and there are very few companies able to provide that as a service (versus a monthly membership), and for one-offs or small batches.

Look at FedEx-Kinkos as an example of a business that is able to exist purely because of peoples’ need for immediacy. This company continues to exist and offer physical locations despite a plethora of online services and home printers because of the immediacy and choice that they provide. Online services take 5–7 days in shipping, and most home printer likely don’t print larger than 11” x 17”. For a one-off project, I head down the street to FedEx.

RadioShack could leverage their existing position in the maker movement and the still high-cost of prototyping equipment for consumers by becoming the place to order a 3D printed or custom etched prototype overnight. This engages not only makers, but solves a large gap in the when it comes small-scale manufacturing and product development.

3. Invest in Education

RadioShack seems to be aware of, and wants to address another major gap in product realization: distribution. In June, RadioShack announced RadioShack Labs in partnership with PCH to help bring maker projects to market. This is a great step, with PCH offering the guidance in product design, manufacturing, and online retail with The Blueprint, and RadioShack providing the offline distribution. But what this doesn’t take into account is RadioShack’s ability to produce quality content, or their lack of a customer base at the current moment. For a partnership like this to be successful and actually impact revenue, they need to provide quality educational content to become a bridge for makers to, in turn, become successful entrepreneurs.

Not only does RadioShack have an opportunity to radically change how makers can turn projects into products, but they also have an opportunity to educate in stores. With better facilities and more inventory, the staff will need to be equally well-educated. This means providing workshops, more original tutorials, and touting a well-trained staff of knowledgeable, passionate staff that are makers in their own right.

RadioShack has made more headway as a corporate entity amongst the maker movement than the majority of its competitors, but never able to translated this position into a meaningful source of revenue.

The company’s brand owns the hearts and minds of a new and growing generation of makers. It just never converted on our wallets. But if the company is going to survive, and even thrive, RadioShack will have to go back to its roots and exist as a brand that’s by makers, and for makers.